Huntsville Metro Area Report

Alabama Business Confidence Index™

Second Quarter 2021

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Strong Expectations for Growth in Huntsville Q2 Survey

Business confidence in Huntsville is returning to pre-COVID-19 levels, according to the Q2 2021 ABCI survey. The metro’s ABCI registered at a very confident 63.8 this quarter, a 7.0-point increase from Q1 2021. Metro panelists are forecasting growth with moderate to very strong confidence in all survey categories. This comes after four quarters of dampened confidence that began in Q2 2020. The indexes for improved statewide economic conditions and increased industry sales are the highest this quarter, signaling strong confidence in forecasts for growth.

Second Quarter 2021 Outlook

Huntsville Statewide
ABCI 63.8 64.3
Alabama Economy 71.0 70.7
US Economy 60.7 63.6
Industry Sales 69.5 68.4
Industry Profits 61.0 61.3
Industry Hiring 63.2 62.3
Industry Capital Expenditures 57.4 59.7

Index above 50 indicates positive outlook as compared to last quarter.
Index below 50 indicates negative outlook compared to last quarter.

Huntsville Component Index Analysis

  • Alabama Economy: Huntsville’s outlook for the Alabama economy increased 13.6 points from Q1 2021 to register at 71.0, the highest index this quarter. This indicates extremely strong confidence in forecasting improved conditions compared to the previous quarter.
  • US Economy: Overall, expectations for the U.S. economy were strongly positive: the index registered at 60.7 in the Q2 2021 survey after increasing 10.7 points from Q1 2021’s neutral index.
  • Industry Sales: With a sales index of 69.5 after a 6.5-point increase, Huntsville businesses continue to anticipate increased sales with very strong confidence in Q2 2021.
  • Industry Profits: Business leaders in Huntsville are expecting increased profits this quarter with a strongly confident index of 61.0, a 4.7-point increase from the Q1 2021 index.
  • Industry Hiring: The Huntsville hiring index registered at a strongly confident 63.2 in Q2 2021. This is only 3.0 points above the previous quarter’s index, indicating continued expectations for increased hiring.
  • Industry Capital Expenditures: Confidence in capital expenditure growth in Q2 compared to Q1 2021 is moderately high. The index registered at 57.4 after increasing 3.5 points from last quarter.

 

Huntsville Response Breakdown

Historical Huntsville ABCI™ and Industry Component Indexes

ABCI Huntsville in Context

After a year of much lower business confidence as Huntsville business leaders navigated the uncertainty that accompanied the COVID-19 pandemic, metro panelists are feeling very optimistic about economic growth in Q2 2021. Huntsville’s ABCI registered at a very confident index of 63.8, which is a return to its levels from Q1 2017 through Q1 2020 when the metro’s average ABCI was 63.1. This consistently high ABCI signaled strong confidence in sustained growth, as opposed to the average index of 54.6 for Q2 2020 through Q1 2021, which though still mildly positive, reflects much less certainty in those forecasts.

Confidence soared across the state in the Q2 2021 survey with all metro ABCIs registering above 63. Business confidence was highest in Tuscaloosa with an ABCI of 65.6, followed closely by Birmingham-Hoover at 65.5. Mobile’s ABCI reached 64.6 this quarter while Huntsville and Montgomery both had ABCIs of 63.8 for the quarter. All of the metros communicated incredibly favorable forecasts for all of the component indexes but especially the Alabama economic outlook and the industry sales index.

ABCI™ by Metro Area

Huntsville ABCI™ Compared to Statewide ABCI™

 

The Center for Business and Economic Research would like to thank the Alabama business executives who completed the second quarter 2021 ABCI™ survey. This is the 78th consecutive quarter this report has been recorded, and it would not have been possible without your participation.
Be sure to log in during the June 1–15 survey window to record your opinions about economic prospects and industry performance looking ahead to the third quarter of 2021.

 

  &  Logo of the Birmingham Business Alliance

This report was produced in partnership between the Center for Business and Economic Research at the The University of Alabama’s Culverhouse College of Business and the Huntsville Area Chamber of Commerce.

Analysis provided by Susannah Robichaux, Socioeconomic Analyst, Center for Business and Economic Research, Culverhouse College of Business, The University of Alabama.

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